Pulse Report June 23

Business operating costs and labour costs in Queensland are at record highs, new Business Chamber Queensland Pulse data shows.  

Businesses are facing the combined impact of high operating costs, high labour and insurance costs, high interest rates and reduced consumer spending which mean they’re less optimistic in the state and nation’s economic future. 

Top constraints on business growth

Interest rates, level of demand and economic activity, workforce challenges and wage costs as well as insurance costs are the most significant constraint on business growth. 

Business insight: Business costs increase as beer flows

Nindigully Pub owner Steve Burns is facing increases in wage and workforce costs, insurance, gas and beer tax. He says they’re costs he needs to pass onto customers if the business is to remain viable.   

“Wage costs are one of the biggest impacts in this business. Business like ours suffer immensely when payroll costs are so high,” he said.  

“We have 11 employees we need to keep in a job, some weeks are busier than others are some are very quiet.” 

Steve said he invested in solar battery storage to reduce power costs but other resources like gas remained costly to the business. At the same time, a twice-yearly tax increase on beer raises the price of a keg by up to $20.

Steve said the cost added up as the drinks flowed. He said flood insurance for the pub, on the banks of the Moonie River, was inaccessible while other insurance costs were ‘through the roof’. 

“Individual businesses have to pass that cost onto the consumer, who are seeing the cost of a beer increase,” he said. 

First opened in 1864, Nindigully Pub, at Thallon, is 700km west of Brisbane. The town’s population is entirely the pub’s workforce while about 50 other people live within a 50km radius. The business is mostly reliant on the domestic tourism market while at the mercy of natural disaster and the weather.  

In busy periods, the kitchen uses three quarters of a ton of beef and half a ton of chicken within a couple of weeks while the bar empties more than 100 kegs of beer in the same period.  

Steve and wife Debbie (pictured) bought the pub 21 years ago. Debbie passed away in 2021 while Steve has stayed on at the business.  

He said despite the challenges, the local community and domestic tourism gave him confidence. The business witnessed a 10-20% increase in tourism month on month over the past year.  

“The Australian people are still supporting country businesses, they love a bush pub and the atmosphere we have created here. It’s really encouraging. 

“The local community is 100% supportive of us all year round and very important to the business. We’re a pub in the middle of nowhere, we don’t have the luxury of being in the city with hundreds of customers every day.  

“We need to continue to invest to meet domestic tourism demand and will need a bigger kitchen and more seating to keep ahead of the crowd. The base of this business is good food, cold beer and good hospitality. 

“It’s an emotional business rather than a financial return business. I’m not selling, I will continue to run it. I’m happy here. The business of Nindigully Pub will survive.”  

Key findings

  • General business conditions increased but remained satisfactory and are expected to decline slightly in the September quarter.  
  • Average selling price remained at moderate levels in the June quarter. Most (47%) of Queensland businesses indicated their average selling price remained unchanged during the June quarter. 
  • Employment levels remained largely unchanged in the June quarter and are expected to hold steady in the September quarter. 
  • Capital expenditure remained steady in the June quarter, expected to fall slightly in the September quarter. 

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Acknowledgement of Country

Business Chamber Queensland respectfully acknowledges the Traditional Owners and custodians of the lands from across Queensland and the Torres Strait. We acknowledge the Jagera and Turrbal people as the Traditional Custodians of Meanjin (Brisbane), the lands where our office is located and the place we meet, work and learn. We pay our respects to Elders past and present.